變
Chapter 8
Evolve
We often associate evolution with the theory of biological adaptation and change. That process, as we learned in school, is driven by random mutations, natural selection, and vast amounts of time. Yet when we apply that same term to innovation, the meaning could not be more different. This type of evolution is not something that happens to us, it's something we actively bring about. It can't take long periods of time, or we won't be here to reap the benefits. And it is not about becoming better adapted to our environment. It's about being willing to change the very ground under our feet, again and again.
When I speak to groups about the discipline that I call Evolve, people sometimes ask if I think that even innovators have a “natural” resistance to change. As I mentioned in an earlier chapter, though, I actually don't necessarily agree with the concept of natural resistance to change. I think there are always reasons for resistance, and the better we understand them, the better able we are to address them. I've mentioned a few of the reasons previously, such as risk of failure, complacency, and the desire to hold on to previous successes.
However, I do believe that innovators themselves can resist change as well. I've seen it happen. Sometimes we were so pleased with the great results we delivered previously that we didn't see a need to change. And because we didn't see a need, we didn't look for one, either. I've also seen innovators become so enamored with a certain new idea or solution or approach that they weren't willing to consider one that was even better. Like everyone else, innovators experience times when they are “stuck in the mud.” This chapter provides some perspective and recommendations that can help us combat that mind-set in ourselves, our teams, and in our organizations.
The Chinese concept of the Universe is that things evolve, or change. The only thing that is sure is that change is constantly happening. Evolve or 變 bian is central to good governance.
The character for bian, falling tone, consists of 言 yan, speech flanked on both sides by 絲 si, silk threads, pronounced lian, above the character which stands for “strike.” Change is tangled and difficult and takes effort; sometimes striking quickly is most effective. Or conversely sometimes change “strikes” quickly. So a leader must be prepared to evolve, to change and have multiple plans of action to deal with whatever may strike, or to foster change when the time is ripe.
Footnote: Here the pronunciation indicator works; lian rhymes with bian.
Overcoming Success
Even when people and organizations fully support and actively pursue change, there are still challenges. It sounds counterintuitive, but success itself often slows momentum. Ming Tsai explains most eloquently how we must handle today's success to avoid inadvertently planting the seeds of tomorrow's failure:
Once you do reach a place—not necessarily at the top, but a place where you are happy—you can't rest on your laurels because, believe me, there's ten other people that would love to be in that spot. And that's where innovation comes in; you have to always be recreating yourself. At Blue Ginger we had a great ten-year run. And then we said okay, let's continue innovating, let's add private dining rooms and a new bar. And when we added a new bar lounge, it gave us that opportunity to add a whole new casual appeal. People could walk in without reservations, wearing blue jeans and shorts and enjoy a Blue Ginger experience, but at half the price. And the private dining allowed us to be more formal. Wedding rehearsals, businesses could hold formal board meetings with dinner, and so forth. So that was a great re-creation and again it put Blue Ginger on the map. People wrote about it, talked about it, and tweeted about it. It was a great way to just remind people about Blue Ginger.
Ten years is a long time. … You can be the best in Wellesley and the best in Boston, but you still need to get people to come back. In Boston there are at least five new restaurants every month. And that's nothing like New York, where there are something like 50 new restaurants a month. So you have to know that, and you can't ignore it and just say, “It's okay, I am the best.” Well you won't remain the best for very long.
Unfortunately, many formerly great, incredibly innovative companies fall into this trap, not realizing that whatever the thing is in their business creating strategic value today may not do so tomorrow. Companies like Kodak—the great pioneer in film production—or Blockbuster—the onetime juggernaut video and DVD retailer—come to mind immediately. Kodak, of course, missed the revolution in digital photography, and Blockbuster became vulnerable when the revolution in streamed content occurred. Compare those companies to businesses like Amazon or IBM that keep a steady eye on creating the future, never stop innovating, and continually reinvent themselves.
The same slowing of momentum that success brings can apply in the case of teams and individuals that have achieved some desired change. In both cases, their solutions may succeed in creating business value and competitive advantage, yet too often become the new status quo. Now, as far as these teams or individuals are concerned, making any changes to their great achievements are just as hard as making changes to the solutions that their achievements have replaced. The prevailing attitude can become, “The company just went to all that trouble, didn't it? Now let's buckle down, get to work, and not try to change it over and over again.” Others may say, “See, we support innovation around here, and now that it's done, let's get back to our real business. After all, we've solved the problem. We're doing things differently—better. It's more efficient, costs less, and gives us all sorts of functionality we never had before. Why change now?”
Tom Mendoza, vice chairman of NetApp, points out that the role of leaders in making sure complacency never sets in can be furthered by good questioning skills—questions that encourage others to put their best thinking forward and not fall into the trap of thinking that enough is good enough.
A good leader probes to make people really think about their solutions. The art of questioning is that you're not threatening anybody, you are not dictatorial, but you are making sure that they understand you want a well-thought-out solution, not just something that is comfortable—because comfort leads to no innovation. Comfort leads to complacency. You may have a piece of your business that is very solid and you just want to just reap it, but you have to keep inventing and innovating if you are going to grow. You have to embrace change. You are either getting better or you are getting worse. If you stay the same, you are getting worse.
Leaders play a critically important role in creating and sustaining the engine of continual innovation, especially when team members are enjoying their hard-earned success. Discerning judgment and the sensitivity of emotional intelligence is needed to fuel continued progress in a way that also honors achievement. Again, Tom Mendoza has insights to share:
When things are going well, you need to inject tension, you need to challenge. Complacency is the number one killer of companies. Feeling that everything is okay and we don't have to keep pushing—that's where it all starts to go wrong. And when times are challenging, you need to provide support. As long as you have the right team and they are doing all the right things, you have got to make sure that they understand you are supporting them. I think most companies do exactly the opposite. When times are good, they are slapping everyone on the back, and when times get tough, they inject tension, which helps nobody.
Success is not achieved by arriving at the right solution to a single problem, or reaching your immediate objectives. Enduring success is achieved by sustaining an innovative culture and process which will continually evolve leading-edge solutions and superior results.
There is one more important situation that innovators who evolve have managed to master. It is our ability to learn from others who have succeeded where we have not. Most of us can learn rather quickly from other people's mistakes. However, it is much more difficult for us to learn from other's successes. Is it caused by jealousy, perhaps? I'm not certain, but when this situation occurs, it often triggers a natural defensiveness that can lead us to overlook the value or validity of what they have produced. This type of response is not unusual, yet it's completely unnecessary and counterproductive. I've always believed that it's best to avoid defensiveness of any kind, since it rarely helps and usually hurts. For innovators, however, defensiveness simply keeps us from incorporating new insights and improvements into our own results.
Dr. Tenley Albright provides a great example in which reexamining an existing solution yielded new insights and significantly improved results. It was the first major project undertaken by MIT Collaborative Initiatives, done in partnership with the Harvard Graduate School of Design. The project focused on assessing stroke care. As Tenley explains:
We decided not to have a physician or a neurologist or a surgeon lead the project. We decided instead to have an architect and designer from the Harvard School of Design, because architects and designers know how to look at the whole system. In medicine we're always drilling down deeper and deeper and deeper to study things. But here was a situation where the important thing was to step back and look at it broadly, analyzing it from a systems point of view. Designers and architects, like our lead Professor Marco Steinberg, know how to do that. As he put it, we needed to unpack the problem so we could know what we didn't know. So it was a new way of looking at a problem that most people thought had already been solved. Yet we came out of the process with a number of new realizations and ways to improve care. By revising the triage process, for example, we could better respond to the patient's individual needs. This change is now saving lives and decreasing costs.
Going Further Beyond
As innovation leaders, our job is to continue to inspire everyone to search for opportunities to innovate, and reward those who never stop looking for opportunities to improve every aspect of the business. By measuring and communicating results, and by earning industry-wide recognition, we can inspire a continuing cycle of innovation that is driven by its own momentum.
The Rapid Value Delivery methodology described in Chapter 7, Execute, also provides a natural vehicle for sustaining the momentum of continual innovation. The goal is to have everyone so excited about the possibilities that open up as each phase is completed that they quickly go about identifying new ideas and improvements that can ride on the most recent change's back. I can recall many projects where exactly that happened. Even before we were done with the core innovation, our engineers were identifying new features and capabilities that would deliver additional business value. With the right support, and the right incentives, those around us will collaborate and compete to discover the next opportunity to improve and change.
Tarkan Maner, previous CEO of Wyse Technology, serial entrepreneur, and investor, puts the concept in a historical context:
One of my favorite mottos is plus ultra. It means “further beyond” in Latin. There is a myth from ancient times that Hercules had erected two columns at the Straits of Gibraltar to mark the edge of the world, which was thought to be flat. And so Mediterranean sailors were warned non plus ultra—nothing further beyond these columns, and they didn't sail past them thinking they'd fall off the face of the earth and die. So non plus ultra was a warning, but it also meant the ultimate place, the last possible achievement.
After Columbus sailed past those columns, sailed west to reach the east, and instead discovered a new world, Carlos V of Spain adopted the columns for the flag. But he changed the motto to plus ultra, meaning always go further beyond. Don't stop achieving and discovering. I always say to myself that life is a marathon, but you're never racing against someone else. You're racing against yourself to find the next opportunity and do something that others did not have the courage or the vision to do.
I learned an important lesson about going further beyond when I was just a girl. When my three sisters and I received permission from the Shanghai local government to visit our parents and our brother for a summer vacation in Hong Kong and go cruising on my father's ship to other Asian countries, we packed one single suitcase for all of us and left everything else behind. We certainly assumed we would be coming home again. However—perhaps subconsciously—I must have been concerned that we might not return, because the only other thing I brought with me was my stamp collection, which I adored. For years, I devoted myself to collecting beautiful multicolored Olympic stamps with all kinds of sports figures. My stamp collection was filled with colorful pictures from exotic lands, such as Olympic skaters in vivid costumes. Since my sister, Margo and I were very athletic, we played basketball, volleyball, and softball, and I also did gymnastics. So the possession I cherished most was my Olympic stamp collection.
At the border station, I watched proudly as the uniformed agent took a special interest in my album, almost expecting to see him demonstrate his admiration with an appreciative nod. Instead, he confiscated my collection.
At first, I stood there frozen in shock, trying to comprehend what he had just done. As my understanding dawned, I began crying, pleading between sobs for him to return my stamps. He was unrelenting, however, and sternly announced that valuables could not leave the country. I begged him to let me send the collection to my grandmother in Shanghai, but he just shook his head, shouted, “No!” and motioned me on. I continued wailing as my sisters hurried me away and across the border. Even today, I can easily retrieve the grief and helplessness of that moment when I lost something in which I had invested so much time, effort, and passion. Thankfully, this happened as I literally crossed into “a new land of hope and opportunity.” Once I reached Hong Kong, I was amazed to find that, everywhere I looked, I saw the same colorful vibrancy that I had loved so much in my stamps! This pivotal and formative experience taught me that change—going “further beyond”—sometimes demands the surrender of our greatest treasures, yet we often gain more than we can even imagine.
Over the course of my career, I have seen countless people go to extraordinary lengths to hang on to whatever “stamp book” they hold dear. What I mean is that, too often they seem to prefer the satisfaction brought by existing accomplishments over the challenge and promise of the future. They're not doing this intentionally, of course. They're just happy with whatever they possess here and now, and they are unaware of what's on the other side.
As innovation leaders, we can help people let go of the “stamp books” by sharing in their thrill of victory with each accomplishment—and then encouraging them onto the next. Sometimes, we must do the same for ourselves as well! Each of us can benefit by maintaining a strong conviction that “the best is yet to come!”
Continual Innovation, Not Constant Change
If there's anything better than Ming's butterfish, which I love and have eaten many times at his Blue Ginger restaurant, it's the fact that his insights into his own business apply so widely to others as well. When I spoke with Ming about the concept of Evolve, he described how it applies to fine dining. Across the industry, he explained, chefs usually change their menus when the seasons change. This allows them to incorporate different fruits, vegetables, and other items that are in season. In addition:
Sometimes you innovate because you don't want a menu with just steak and potatoes on it. Other times you want to impress your chef friends, you want something that people in your industry will enjoy. But mostly you innovate because you have to keep it fresh. At least 50 percent of my customers are here a minimum of once a month, and they'll tire of the menu if we don't keep innovating. Still, I always say, don't change something because it feels good to change. Change something because it's a better dish.
For Ming, there is business value in introducing variety. This isn't often the case for businesses, of course. More typically, customers consider change to be a disruption. However, even in a dining establishment where change and variety is inherently desirable, Ming still upholds a standard of continuous improvement. Not just good, better. We don't change just for the sake of change, Ming explained. We change to be better.
This critically important point is fundamental to the discipline of Evolve. It's not about continual change; it's about continual innovation. And, as we have said throughout the book, we define that as creating business value and increasing competitive advantage.
Gerald Chertavian, founder of Year Up, has implemented a formal process for building continual innovation into his organization:
Internally, we try to institutionalize innovation every six months. We have something we call intersession after every class graduates, for about a month, where we get together as a group city by city. We talk about what went right, what went wrong, what should we change for the next class. There are no sacred cows. Typically we try to talk strictly about the issues—what's been done right and what's been done wrong without casting blame on individuals for making mistakes or for bad judgment. We just stay focused on what's best for students.
In addition, every six months we take a hard look at the program as a whole to see what innovations might be relevant. So we balance capturing and standardizing on best practice while continuing to allow innovation where we know we still have a lot to learn.
In this discussion, Gerald brings up the important concept of standardization and its use as a vehicle for improvement. By identifying and implementing best practices, organizations improve quality and consistency while reducing cost and complexity. They also create a baseline for future improvement. Yet, as Gerald discusses further below, standardizing too rigidly can accomplish the opposite effect:
For any multisite organization it's a constant tension between where you allow or even incent differentiation and where you require standardization. It's a constant evaluation process. I think you can develop some frameworks for how to think about it, but they're constantly changing in response to the organization's needs. We feel that the absolutely most important things to standardize on are culture, values, and operating principles. Our six values are stated and appointed in every place in the organization you can look, and most decisions are tied back to those values. We have three operating principles: high support, high expectations, and high service. We ask every single leader to demonstrate those operating principles on a daily basis and hold others accountable for doing the same. We also believe in standardizing data. If you have a certain amount of standardization on data, you can drive process control. If you can drive process control, you can drive quality. So it's a lot easier to say “enter data this way,” and it's apparent when someone hasn't. You get quality control without having to impose it by actually focusing on data. Centralization of data helps define a better organization. I want people to be able to focus on educational outcomes and let the local site adapt to its market. If you consistently focus on values, operating principles, and data, then you don't have to control what people do on a micro level, which would just stifle their creativity and take away their autonomy and motivation.
Gerald's approach to standardization provides a firm foundation while encouraging continual innovation and customization to local requirements. As he discusses further below, his approach also leverages distributed experimentation in a way that helps the company determine enterprise-level standards:
We're thinking right now about learning management systems and how we can integrate technology into the curriculum. We're asking ourselves about whether we give each instructor some incentive or capital to try various types of educational technology or just identify a central system to push into the organization.
Given how nascent we are in the educational technology industry, my instinct is to let early adopters come in and support them, hold them up, recognize them. And then over time, figure out what we should standardize around for educational technology. I think the maturity of the industry is obviously going to play a role in determining whether you want innovation happening and how deeply you want that to go.
Clearing the Path
In prior chapters, we discussed the importance of making innovation a part of everyone's routine and every employee's obligation to his/her business, and not relegating it solely to research and development or to business strategists. But with day-to-day operations—putting out the fires and just keeping the operation running smoothly—as the focus of most of our time, attention, and energies, how do we do this?
Jim Phalen of State Street describes the challenge and how he is addressing it by opening up the company's strategic planning processes, inviting ideas and contributions from its global employee base.
I have incredible respect for middle managers. They run the show. When you need to make a change, when you get down to the hard work, they are the people that do it. Many organizations leave innovation to their managers. Sure, they can contribute tremendously, but usually, they are the ones trying to keep the trains running on time. We put incredible pressure on them, and the message they get from us, in most organizations, is usually about not messing up.
You can take these managers out of their day-to-day twice a month and ask them to innovate, but unless you are in a crisis, you are probably not going to get big new ideas, and you shouldn't expect to. That's not their failure. We've focused them on protecting the downside rather than building the upside. We haven't pushed the chair back far enough for them to say, tell me what you can do if you are fully automated. Don't think about your process being 10 percent better, think about it being 400 percent better, or totally different, where maybe you don't even do that process anymore.
I think one of the most important things is figuring out how you are going to get those out-of-the-box ideas and combine them with the great manager who can help refine and build on them. So, at State Street, we're engaging all of our employees worldwide in the process of innovation, rather than just the middle managers. In a way, it's putting more pressure on our middle managers because we've gone below them as well as above them. But we are trying to open up the process. It's not about finding problems; it's about finding ways to be even better than we are today.
Through the use of collaboration tools, social media, and innovation rally events, State Street employees are forming and joining communities that cross functional, geographic, and business boundaries. Communities focus on business topics such as products, services, markets, and customers as well as internal topics such as sustainability and flexible work. Nearly 70 percent of State Street employees have some type of flexibility in their schedule, so it is a particularly active community. Members support each other by answering questions and suggesting strategies, and the “wisdom of the crowd” elevates the best program improvement ideas for consideration by the corporate support team. Like Year Up, State Street is leveraging this distributed yet still collective intelligence to identify and implement continual innovation.
IBM, through many years, has created one of the best-known innovation machines, establishing the kind of culture where change is the norm rather than the exception, and innovation has become business-as-usual. Linda Sanford, IBM's senior vice president, Enterprise Transformation, explains IBM's systemic approach to moving forward and never resting on its laurels:
Creating a culture that values innovation is part of IBM's DNA—from the earliest days when company founder Thomas Watson embraced the term “Think” to inspire creativity from his teams, to the present when innovation has become a cultural underpinning and competitive advantage. Innovation is a by-product of hard work, creativity, skill, and delivering support to develop ideas. Advancing this environment is paramount at IBM.
With an R&D investment that has held steady at around $6 billion a year, IBM is one of the world's biggest proponents of “ground-up” innovation—a philosophy that has produced everything from the relational database to Watson, the computer system capable of fielding natural language questions. Giving creative minds the space to explore big ideas is the norm at IBM.
So is celebrating innovation. Each year, the company names new IBM Fellows and Distinguished Engineers to honor those who have made significant contributions while giving them additional resources to continue innovating. We give a lot of visibility to our outstanding innovators and our next generation technologists aspire to reach the same heights.
In addition, the company's Technology Adoption Program is a community of employees who exchange new applications and technical ideas and consider their value to the marketplace. Ideas that show the most promise are funded for development. Since we started this program in 2005, more than 1,500 applications have been piloted through this program. It's been a great way for our technologists to get real-time feedback on their applications.
Regularly, IBM also holds “HackDay”—an open forum for employees to share for solving business and IT challenges. A recent HackDay explored how IBM could expand as a social business, looking at broader ways to use Facebook, Twitter, and even IBM's own social media community, Connections.
Adversity and Change
Of course, success is not the only cause of innovators digging in their heels. As the inventor and entrepreneur Nathan Myhrvold described in Chapter 6, Commit, one of the greatest challenges an innovator faces is being able to recognize the difference between when it's time to keep pushing forward and when it's time to stop. There's no formula, Nathan indicated, other than asking yourself what you would do at that moment if you were just starting from scratch. If you hadn't already invested so much in that effort, would you do it now?
As discussed in earlier chapters, a culture that avoids penalizing failure provides a necessary foundation for asking and answering a question like that. Tom Mendoza, who established that type of culture at NetApp, acknowledges that the question is difficult, yet the answer is sometimes very clear:
Sometimes you just have to change because if you keep going in the same direction you are going to lose. You have got to be honest about it. I think the worst thing you can do is to have a culture where you can't say that we are losing. You need a culture of safety, where as long as you are doing what you think is right for the company, not for personal gain or advancement, then you put it on the table. You need to be honest about what really is working and what's really not working. And if something is not working, the company has to accept that.
During the banking slowdown, for example, we had a lot of endeavors underway. We had an offsite and took a look at these projects to see if they were the right investments given what we knew was going to happen to the economy and the banking sector. I don't believe in the approach where, when things get bad, everybody cuts their budgets by 20 percent. You might end up cutting the area that could innovate you out of the problem by 20 percent, and you're cutting something that is going to be worthless by 20 percent too.
So, instead, we said, if we had a lot more money, where would be put it now. There was amazing consensus about where we'd all make a big bet. Then we said, okay, we don't have a lot more money, so what three things are we going to stop investing in so we can get it? Again—we got amazing consensus. We stopped all three that were identified, and one meant having to sell off a company we had bought less than a year before. That was painful, and it certainly affected people in that room. We just said, “You know what, given the new reality, that investment's not going to pay off. We are not going to spend the next five years grooming it, we are going to sell it, and we are going to take that investment and put it somewhere else.”
Like Nathan, Tom and his executive team found that they needed to consciously and deliberately set aside the financial and emotional investments of the past. In a culture that does not penalize failure, this can be done. Shedding and learning from the mistakes of the past makes a great deal of sense. In a culture where past mistakes significantly impact future prospects, however, it is a much more difficult task to accomplish.
Regardless of the culture that we find ourselves in, it's hard to admit that we don't have all of the answers. It takes strong leadership to admit mistakes and take action to fix them. This is much harder to do than to just keep going until it is too late. Quick action on this front will keep the business from wasting more investment money and not getting the expected returns.
As much as I dislike the concept of natural resistance to change, I do believe that human beings have a natural resistance to changing ourselves and our beliefs. It can be done, but it is hard work, as Dr. Eugene Chan can attest. In Chapter 2, Dr. Chan, founder of the DNA Medicine Institute and several other startup companies, told us that he had never truly appreciated the positive lessons that can be learned from failure until half of his company quit. He completely changed his understanding of what leadership means and changed himself as a result.
It was a personal evolution, which is very hard for most people. I have to say that if that early leadership failure of mine hadn't happened, there's a chance that even to this day I wouldn't realize what I was doing wrong. But it was one of those times where you just have to be reflective and you have to evolve. You have to think, “Hey, am I doing something wrong here?” So I thought about it, and I knew that it wasn't as though these employees were all bad and so that's why they left the company. Something must be wrong with me.
It's very difficult to see the things that you don't know about yourself. But by shouldering that blame and doing the introspection, you learn. And I have to say that it's been amazing and it's been transformative. It made me so much more effective at doing what I do.
I think any failure is filled with huge learning opportunities if you're willing to examine it rather than just brush it off. There's no better way to be better.
And if you don't take advantage of those opportunities, the issue is just going to come up again. And I think this is true for organizations as a whole as well as for people.
I couldn't agree more. In fact, the same viewpoint was described in Chapter 6, Commit, by Admiral Mullen, who almost ended his career when he crashed his first ship. I believe that, as innovators and as people, our response to adversity is the single most important determiner of our success. The question isn't whether or not we will experience it, because adversity is inevitable. The question is what we will do when it happens. Will we view the challenges it poses as a motivator, a way to help us learn and evolve, or will we see it as an enemy and hunker down instead?
Challenges and adversity are everywhere and if we do not learn to deal with them, we will be at a disadvantage in all aspects of our lives and careers. I once heard a successful executive talk about her belief that the term career path sets improper expectations for young people entering the work force. She believed that it gave young people the impression that a pathway was already carved out and that all that was required on their part was to follow it. “They should call it a ‘career obstacle course’ instead.” she joked, so that people would go into their careers knowing that their progress would depend on their ability to move past the problems and difficulties that life will put in their way.
I thought about her comment when I chose the name for this book, The Innovator's Path. I've mentioned it earlier in the book, and by now I'm quite sure that readers know full well that their path to innovation is not already cut out for them. They are the ones doing the cutting; they are the ones leading the way. Leading innovation requires passion, a positive attitude and outlook, and a strong conviction to avoid wasting time on the negative. When we encounter challenges, we first try to turn them around, transforming problems into opportunities and adversaries into allies. When that's not possible, we don't waste our time in battle; we work around that which we cannot control or change. Doing so requires skillful leadership and connection, but it's worth the time and will be a huge win for the team, for the organization, and for ourselves.
I have had the great pleasure of attending several of Dean Kamen's FIRST events. Dean is helping to create and energize our next generation of innovators. I believe that his approach to putting kids in situations where they have to “cut their own paths” has important lessons for us all.
FIRST is about showing kids that innovation, even though you fail a lot, is fun, it is exciting, and it is worth the failures. And at FIRST we work really, really, really hard to give kids problems to which they can't go find the answer in the back of a book. We give them a pile of junk and a problem statement. And we work all year on creating the problem statements and the pile of junk. … We continue to add complexity to all the problem statements until a whole bunch of “smart people” would all violently disagree on what is the “right answer,” because the whole point is, there is no right answer to most problems. There's no best solution to real problems, because there's an infinite number of different ways that you can add imagination to all the tools in your box and come up with something that's never been done before. And that's exciting.
Now, as I've done throughout this book, I'll ask each reader to evaluate him or herself on the scale of effectiveness below.
Evolve: Levels of Effectiveness
Level One: Satisfied
At Level One we are fully content with recent efforts and achievements and are enjoying a sense of completion and pride. We are feeling comfortable and secure with the company's current strategic and competitive position and the role we've played in both.
Level Two: Pacing
At Level Two we are pleased with recent efforts and achievements but are open to ongoing change and improvement. We are continually monitoring the company's strategic and competitive position and remain alert for the need to make changes.
Level Three: Driving
At Level Three we've already moved on! We are actively seeking and implementing change and improvement. We are making a major impact on the company recognizing that innovation should be a part of every business process. We are continually seeking ways to enhance strategic value and improve our competitive position.
Evolving from Certification to Cloud
In Chapter 7, Execute, I discussed our server certification process as an example of a project with rapid value delivery. We responded to customer needs, taking a difficult problem and making the solution incrementally better and better. This chapter, Evolve, allows me to pick up where I left off and demonstrate the principle of leaving our good work behind.
In some ways, our Server Integration Services team had a thankless role, as functions that come into play at the tail end of a process are often at a disadvantage. They're not always included in planning and design discussions and must therefore play “catch up” before they can contribute meaningfully. They often find that key decisions have already been made and cast in stone, despite the fact that they could have offered even better solutions. Yet, because they know that by that point in time their input would just be perceived as a complaint, they do their best to grin and bear it. And, to make matters worse, most of the contingency time in the project schedule has already been used up, so they are also typically racing against the clock.
As I described in Execute, the team did a great job coming up with an automated one-hour server certification solution that dramatically accelerated their response time. However, it could only be used for standard requests. When servers required customization, which they very often did, the process could still take weeks. As Nathan Myhrvold told us in Chapter 1, Listen, Henry Ford did not try to make a faster horse. He recognized that any significant improvement from that point on would require an entirely new solution. We recognized that as well.
We began implementing a solution in our data center that we called POD, for Processing on Demand, which is a standardized and pre-built environment. This was a container-like design that unified network, server, storage, and even air conditioning. Each POD was its own virtualized environment built around a core of seven cabinets, for 63 servers in a POD. A POD could be quickly deployed without the usual connectivity challenges of individual components. And because of the multiserver and storage virtualization, more capacity was easily available to applications, requiring fewer new servers to be certified. Although the terms cloud computing environment and infrastructure-as-a-service were not widely used then, these were the very same concepts underlying our POD solution.
Of course, the full value of this solution could only be realized in a fully standardized environment. We worked closely with State Street's IT Architecture group to achieve that vision. Using POD as the foundation, the team developed a standardized application services platform that allowed developers to use self-service rather than certification to provision their application environments. An automated workflow manages the authorization approvals and, in minutes, the system automatically provisions the desired application environment, doing so in a highly resilient active/active configuration across two data centers. In addition to infrastructure-as-a-service, we now have platform-as-a-service, software-as-a-service, business services and information services, with each layer standardized and prebuilt.
This private cloud architecture is retooling and reframing the way that State Street's entire IT function operates, introducing an unprecedented degree of speed, resiliency, cost-effectiveness, and control. In addition to providing a significant return on IT investment, it is heightening State Street's capacity for rapid innovation and providing a launching point for several strategic new business services, such as a self-service data warehouse and extended analytic data services.
Evolve—Concrete Steps for Putting This Discipline into Action
Let's turn now to our summary of Evolve in the context of the individual and the team and organization.
Individual
Continual innovation for the individual means producing results and celebrating success, yet never allowing ourselves to be content with what we have achieved. We can maintain a mind-set of “the best is yet to come” and constantly search out ways to be better. This applies to how we respond to adversity as well. We always stay positive and do not waste time on things we cannot control. Innovators don't defend themselves against opportunities to learn; they seek them out.
Team and Organization
Teams often bond around the great accomplishments that they produce, yet this bonding can produce a new and rigid status quo. The role of the team leader, therefore, is critical. We have to be open to suggestions for doing things differently, reward questions as much as answers, and encourage new ideas. In so doing, we continually encourage the team to move forward and out of its comfort zone.
An organization's culture should be one that inspires and encourages people to continually innovate. This requires executive focus and structured processes that continually examine existing solutions and challenge people to think about ways to improve them. The organization should implement practices that instill and/or reinforce the idea of “innovation-as-usual.”